Exam 20: Ownership and Warranties

A common problem in cases of express warranty is being able to separate statements that create express warranties from statements that do not.Discuss what type of statements create an express warranty and four indications that a statement is likely to create an express warranty.

Mike sold his car to Beth,who was to pick the car up at Mike's house by 12:00 noon on September 1.Mike was at his house waiting for Beth but she was late.In fact,when Beth arrived she discovered Mike's home and the car destroyed by a fire that started at 1:00 p.m.The risk of loss falls on:

Hill Computers is a retailer,which buys its inventory from Acme Co.on credit,giving Acme a security interest in the inventory.Hubert buys a computer from Hill in the normal course of business.Hubert's title in the computer is:

Inez contracted with Filippo Furnaces Co.for the installation of a new furnace.Inez selected the furnace she wanted,accepting no suggestions from Filippo Furnaces' heating engineer.The furnace operated fine,but it did not heat the entire house.The size of the blower on the furnace was too small to accommodate the third floor of the house.Inez sued Filippo Furnaces Co.for the breach of the implied warranties of merchantability and fitness.What result?

A sales representative at Oxtren,Inc.orally told the purchasing agent at Wety,Inc.that its industrial saw will cut through metal up to 5 inches thick.Wety purchased the saw.Which statement is correct concerning the claim that the saw can cut through metal up to five inches thick?

The UCC looks solely upon "title" to determine ownership in goods.

The plaintiff,Donald Laird has a bachelor of science degree in animal science,had previously been employed at the university's swine research center,had managed a feed mill,had been employed as a herdsman for Hog Breeders,Incorporated,had worked for five years for Armour & Company at its feeder pig operations,and was a branch manager of the Scribner Co-op,Inc.for 14 years.Laird's assistant manager while at the Co-op was Gary Ruwe.When Laird quit the Co-op,Ruwe became the manager.Later,Laird went to Co-op to purchase some feed ingredients for his hogs.In speaking with Ruwe,Laird learned that the Co-op grain bin was not operating properly and therefore the corn was not drying properly.If the corn does not dry properly,it can collect mold and insects.Laird said he would take 1300 bushels of corn if Ruwe could pull the corn out of the middle of the grain bin.The corn was delivered to Laird where he noticed some damaged corn and an odor that indicated that the corn may have mold.Laird did not reject the shipment,however.Laird then began to feed the corn to his hogs.The boars began to develop pneumonia,began vomiting,and would not eat regularly.When it was time for the sows to farrow,the sows had an abnormally high number of miscarriages and stillborns.The ultimate conclusion was that the corn delivered was tainted with vomitoxins,a toxic substance that made the corn unmarketable as feed.Laird sued the Co-op for breach of the implied warranties of fitness for a particular purpose and merchantability.In order to recover under the warranty of fitness for a particular purpose what does Laird have to prove? What is the implied warranty of merchantability? Does Laird have a successful claim with this warranty?

Under the UCC,the party who has title to the goods always has the risk of loss.

In a shipment contract,title and risk of loss pass to the buyer when the goods are properly tendered at the destination point.

Rayco entered into a contract to buy Chia Pets from We Grow 'Em.The contract specified that the shipment would be "F.O.B.destination;title to pass on the date of shipment." The goods were destroyed in transit to Rayco.Rayco argues that the loss is We Grow 'Em's.Analyze the situation and determine who is liable for the loss.

Mark,a power tool salesman,promises Jill,a customer,that the Turbo Power Hedge Trimmer 1000 will easily cut through bamboo up to 3 inches thick.Mark's statement constitutes an express warranty if Jill purchases the hedge trimmer.

Dick steals Jane's camcorder and sells it to Sid.Jane can recover the camcorder from Sid:

Many states prohibit a seller from disclaiming implied warranties in the sale of consumer goods.

Tu-thumbs buys a used paint sprayer from the local paint store.The sprayer had a large sign on it which said "ASIS." The dealer made no promises or statements concerning the performance of the paint sprayer.When Tu-thumbs attempts to spray paint his house,the trigger on the sprayer sticks in the "on" position and before Tu-thumbs can pull the electrical cord to cut the power,paint is sprayed all over his prize Borzoi dog that is scheduled to be shown in a dog show the next day.Tu-thumbs sues the dealership.Who wins?

In the case of Lindholm v.Brant,the court ruled:

Marco Manufacturing contracted to sell Kurtz Industries 3,000 iron clasps.The contract specified:F.O.B.Kurtz Industries.Upon arrival and inspection,the goods were rejected by Kurtz Industries because they did not conform to the contract specifications.In transit back to Marco Manufacturing,the common carrier's truck overturned and completely destroyed the clasps.Which statement is correct?

The statute of limitations for breach of warranty under the UCC is?

If Terrill steals a digital camera and sells it to Samuel,Samuel will get a valid title as long as he can prove he gave value for the camera and acted in good faith.

Alice's Aspirin Inc. ,produces and packages aspirin for sale to retail stores.Bob buys a bottle of Alice's aspirin at Dahl's Food Stores.Two days later Bob's friend,Hank,takes two aspirin while at Bob's house.Within minutes,Hank is very ill and is rushed to the hospital,where it is found that a defect in the aspirin caused the reaction.Which of the following is correct?

In a consignment contract,the consignee: